Monday, June 7, 2010

Dow at Low for the Year

Stocks slumped Monday, with the Dow and S&P 500 ending at 7-month lows, after the euro hit a fresh four-year low, adding to worries about the global economy.

The Dow Jones industrial average (INDU) lost 115 points, or 1.2%, closing at the lowest point since Nov. 4.

There was some positivity in the morning but the markets turned very sour in the afternoon and the Dow finished at 9816. The news, however, isn't all bad. A Goldman Sachs analyst says that the worst is over. Crude oil will be a very important commodity to watch this summer but it's holding steady at just over $71 a barrel.

Investors remain nervous about the state of the global economy but should be comforted that things are generally better in the US than around the world, Goldman Sachs analyst Abby Joseph Cohen told CNBC.

"The US economic recovery, even though it's in fits and starts and even though we're disappointed at the rate of the increase in jobs creation, is doing better than most of the other developed economies, including those in Western Europe and Japan," said Cohen, president of Goldman's Global Markets Institute.

Of course, with equities continuing to weaken, bonds continue to strengthen. The ten year was slightly worse but finished at 3.16%, which is near its six month low, for the rate.